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How to Handle a Certificate of Insurance Request

April 4th, 2023 | 4 min. read

By Daniel J. Middleton

Business is going great. And recently, a potential client over in Homer looked you up, liked what he saw, and reached out to inquire about a kitchen remodel. But before you can scope the work, present a timeline, or even a budget, the client says:

“I was wondering if you could provide me with a certificate of insurance before we get started.”

Yep. You need to show proof of business insurance to land this job. But how do you go about doing that? Why can’t you just show them your insurance policy and be done with it?

This is probably the first you’ve heard of a certificate of insurance or COI. Or maybe it was mentioned before, but you never bothered to look into it.

This type of request also raises other questions, like, “What if a client asks me to show proof of insurance for a policy I don’t have?”.

Not to fear. As an agency that handles many COI requests, we’ve provided our clients with thousands of insurance certificates over the years. We can deal swiftly with basic requests from your customer or client and spot the ones that could spell trouble for you.

Proof of insurance requests can surprise or even frustrate you. And we know you just want to get to work and not have to resort to Google to struggle through the insurance abyss.

That’s why we wrote this article, to help you understand

  1. the purpose of a certificate of insurance
  2. the steps to take to obtain one, and
  3. how to handle unexpected requirements

Why Am I Being Asked for a Certificate of Insurance?

Whether you’re a floor installation contractor or a professional consultant, you’ve probably been asked to provide proof of liability insurance prior to beginning a job. This proof comes in the form of a Certificate of Insurance (also called a Certificate of Liability Insurance or ACORD 25 COI).

You might have received an example of a generic COI from your customer.

Clients ask for a certificate of insurance to protect themselves against various accidents or negligence resulting from the work you will be doing for them.

The COI shows that you have the necessary insurance to cover any damages or injuries that may occur. This is important for both you and your client, as it can help to prevent financial losses in the event of an accident.

A COI is a summary of your insurance policy that includes core details, such as the type of insurance, the policy number, and the liability limits. It is a secure and convenient way to share your insurance information with a client.

This is a basic request that any well-run organization would ask of a small business owner with whom they’ve entered into an agreement.

How Do I Obtain a Certificate of Insurance?

Many times insurance-related issues can feel overwhelming. Thankfully, obtaining proof of coverage via a COI is fairly easy.

Simply contact your insurance agent or carrier and let them know about the COI request you received.

At no cost to you, the agent will add primary info to the COI as follows:

  • Your business name
  • The beginning and ending dates on the policy (effective dates)
  • Name of the insurance carrier
  • Name of the insurance agency
  • Policy type(s), i.e., general liability, workers comp, commercial auto
  • The amount of coverage you have for each policy type

Why Does My Customer Want to Be a Certificate Holder?

There are times when you may be asked to make your customer a “certificate holder.”

While also not complicated, meeting this request is not as simple as merely placing the certificate in your customer’s hand to “hold.”

When you first begin an insurance policy you will receive a certificate of insurance. It shows all the basic information mentioned in the previous section.

However, it does not prove that the policy is in force at that moment. It only proves that it was active at some point.

To designate your client as a Certificate Holder, your agent or carrier will add your client’s name and address to the certificate. That would not be possible on a policy not in good standing.

So, this is the surest way your customer can verify that your insurance is current. This is also why you can’t show them your insurance policy instead of your certificate to satisfy a COI request.

How Do I Handle COI Requests for Insurance I Don’t Have?

A COI request for insurance you don’t have.Sometimes you might be asked to show proof of insurance for a policy you don’t currently have or perhaps don’t need.

This is a tricky one, and it’s something we see often.

The scenario usually goes something like this:

  1. You and your customer agree to the terms of the project.
  2. You receive a request to provide proof of insurance.
  3. On that request, there are between three to five required policies for which you need to provide proof of being in force (or currently active).
  4. The problem is you only have one or two of those required policies at most.

Does that mean you have to buy more insurance? Not always.

Certificate requests are often broad, and the same sample is sent to anyone with whom your client wishes to enter into an agreement.

The request may also have been sent by someone other than the person you dealt with directly, so your line of business and the type of insurance you need to conduct that business were likely not considered for the COI request.

In such cases, you can sometimes bypass the request for insurance you don’t have or don’t need by briefly conversing with your customer or client. They might say it’s okay that you don’t have a professional liability and commercial umbrella policy and allow you to obtain a certificate without those policies listed.

But be advised that there are times when some of your clients will not budge and insist that all listed policies be in force before work can be done. That is why it is critical that you find out what their insurance requirements are before you come to terms with them.

Additional policies will add costs and may not be readily available to you depending on your profession.

If the job is lucrative enough you might decide to purchase those policies. We’ll help you work out the complexities and arrive at a timely solution once you contact us.

Who Can I Trust with a Certificate of Insurance Request?

It’s essential to have a relationship with an agency that can quickly respond to certificate requests and check them for anything that could be harmful to you or your business.

Our team will ensure you have an accurate certificate so you can conveniently provide it to your customer or client to land the job you were hired to do.

Avoid agencies that take days or even weeks to get you a certificate. That can cost you time and money and even jeopardize your relationship with the customer. Negative word of mouth will only spiral from there, costing you future jobs.

We understand that insurance triggers stress and confusion, and COI requests can be no different. We’ll help reduce or remove both stress and confusion for you, as we have for many other business owners in your shoes.

We can help you purchase a needed policy for your upcoming project. Simply click the Get a Quote button below to get started.

If you want to learn about another frequently requested commercial policy, read “Why Must CNY Contractors Have Workers Comp Insurance?

Daniel J. Middleton

Daniel is an accomplished content creator. He has been working in publishing for almost two decades. Horan Companies hired Daniel as its content manager in November 2022. The agency entrusted its messaging to him. Since then, Daniel has written insurance articles, service and pillar pages, and more. All in an effort to educate CNY readers. He's helping them understand the world of insurance so they can make informed decisions.